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Press Release: IMF Statement on The Gambia

December 10, 2003

The staff of the International Monetary Fund (IMF), which is currently preparing for the Executive Board's completion in late January of an Article IV review of The Gambia, issued the following statement today in Washington, DC:

"The IMF staff is concerned about the deteriorating economic situation in The Gambia. Macroeconomic imbalances have worsened, as evidenced by the weak growth performance, high inflation, the sharp depreciation of the exchange rate and an increasing fiscal deficit. Monetary growth has been substantially higher than warranted. Moreover, information that has recently been made available to the staff suggests that data on foreign international reserves provided to the Fund earlier may have been significantly overstated and that there were associated inaccuracies in data on government expenditure, fiscal balances and credit flows in 2001. These developments threaten to impede progress on poverty reduction.

"Discussions on the country's PRGF-supported program, which is currently off-track, could be resumed once additional information has been received and understandings are reached on the appropriate corrective actions. A resumption of Fund assistance and donors' budgetary support is important in bringing about a return to macroeconomic stability and reducing poverty in The Gambia. The Managing Director of the IMF has written to The Gambian authorities regarding the understandings necessary to bring the PRGF-supported program back on track. The Fund staff is also pursuing the issues regarding data on foreign international reserves with the authorities in order to ascertain the relevant facts."